USell.com Announces Earnings Results for the Second Quarter and Six Months Ended June 30, 2014
August 18, 2014 at 06:00 pm IST
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uSell.com announced earnings results for the second quarter and six months ended June 30, 2014. For the second quarter of 2014, revenues reached a record $1.7 million, a 40% increase from $1.2 million in the second quarter of 2013. This increase in revenue is primarily due to the change in business model, which resulted in increased prices, conversion rates and throughput. Operating and net loss for the second quarter of 2014 was $1.3 million, an increase of $0.2 million from $1.1 million in the second quarter of 2013. Of note, the adjusted operating loss, a non GAAP financial measure, for the second quarter was $811,105, an increase of $156,090 from $655,015 in the second quarter of 2013, due to the exclusion of non cash stock-based compensation. The increase in operating loss was primarily due to an increase in marketing cost as a percentage of revenue. Under the new model, revenue lags marketing expense by 5-6 weeks. The resulting LPS is $0.22, as compared to $0.24 a year earlier.
For the six months ended June 30, 2014, revenues were $2.7 million, a 20% increase from $2.3 million for the six months ended June 30, 2013. A gross profit margin of 90% was realized in the first half of 2014, which is consistent with the past trend of 90%+ gross margins. Operating loss for the six months ended June 30, 2014 was $2.59 million, a decrease of $0.16 million from $2.75 million in the six months ended June 30, 2013. Net loss for the six months ended June 30, 2014 was $4.2 million, an increase of $1.5 million from $2.7 million in the six months ended June 30, 2013. Of note, the adjusted operating loss, a non GAAP financial measure, for the first half of 2014 was $1.8 million, an increase of $0.5 million from $1.3 million in the first half of 2013, due to the exclusion of non cash stock-based compensation. The resulting LPS is $0.75, as compared to $0.65 a year earlier. Net loss and EPS results from the first six months of 2014 include interest expense of $0.9 million and a change in fair value of derivative liability relating to conversion feature of Series A preferred stock of $0.7 million.
PhoneX Holdings, Inc. is engaged in building the cloud-based software-as-a service solution for the wholesale exchange of pre-owned mobile devices. The Company works with mobile carriers and mobile handset distributors to facilitate global commerce related to pre-owned mobile devices. The Company operates through two models: Proprietary Trading Model and Platform Partnership Model. Its Proprietary Trading Model, through which it purchases devices utilizing its own balance sheet via its subsidiary We Sell Cellular LLC. Its Platform Partnership Model, through which it enables its partners to license its software via its subsidiary PhoneX, Inc. Through these licensing agreements, the Company enables mobile carriers and mobile handset distributors to increase selling prices and selling velocity by using a specialized, automated platform where wholesale buyers of mobile devices can purchase inventory on demand.